JOHANNESBURG - The rand held steady against a weaker dollar yesterday as investor optimism that a US-Mexico deal would help avert a global trade war boosted appetite for riskier assets.
Meanwhile, Woolworths led the bourse higher, as several retailers rose on the back of demand in the sector. It gained 4.11percent to R53.41, Foschini advanced 1.56percent to R186.30 and Truworths closed 0.54percent higher at R90.61.
The JSE Top40 index rose 0.61percent to 53883.33 points, while the all share index climbed 0.64percent to 60039.27 points.
Cashbuild bucked the trend, falling 3.21percent to R302.94 after reporting a 9percent drop in annual profit as costs rose and demand dipped.
Halen Bothma, an analyst at ETM Analytics, said trading was largely range-bound up until the news on land expropriation.
“The market is very sensitive to news around the land expropriation topic, which is understandable because of its importance to the South African economy,” Bothma said.
“(The rand) reacted strongly but it has erased those moves as people have realised it doesn’t change anything.”
At 5pm, the rand bid at R14.1222 to the dollar, 1cent firmer than at the same time on Monday, after rallying briefly to R13.9525 earlier after parliament withdrew an expropriation bill passed in 2016 that allowed the state to make compulsory purchases of land.
The thrust of the bill, which had not been signed into law, has been overtaken by a proposal by the ANC to change the constitution to allow the expropriation of land without compensation.
Having tumbled to 2-year lows just shy of R16 mark earlier this month, as the massive sell-off in Turkish lira spread to other emerging markets, the rand has seen increased intra-day volatility in response to news.
The rand was steady as traders eyed talks between the US and Mexico who agreed on Monday to overhaul the North American Free Trade Agreement, putting pressure on Canada to agree to new terms on auto trade and dispute settlement rules to remain part of the three-nation pact.
In fixed income, the yield on the benchmark government paper due in 2026 added 0.5 basis points to 8.875percent.